Question
The following graph shows the present worth for three different projects (Projects A, B, C) at various interest rates. Use this information to answer the
The following graph shows the present worth for three different projects (Projects A, B, C) at various interest rates. Use this information to answer the questions belo
a) Assume that the company can invest in as many (or few) projects as it wants to. Assuming its MARR is 17%, which investment(s) should it select? Select all options that apply.
A
B
C
None of the above
b) Assume that the projects shown above are mutually exclusive. Which option(s) should the company invest in assuming its MARR is 4%? Select all options that apply.
A
B
C
None of the above
c) Which project has the greatest IRR?
A
B
C
None of the above
d) What is the IRR of Project A? Estimate to the nearest percentage. For example, if you get 15.3%, enter 15
e) What is the incremental IRR, i*C-B? Estimate to the nearest percentage. For example, if you get 15.3%, enter 15
f) Under what conditions would we would recommend project A if the projects are mutually exclusive? Select all that apply
When MARR>12%
When MARR<13%
When MARR<8%
It should never be recommended
g) Under what conditions would we would recommend project C if the projects are mutually exclusive? Select all that apply
When MARR>12%
When MARR<13%
When MARR>8%
It should never be recommended
Cannot be determined
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